R.V. v. Mnuchin
| Decision Date | 19 June 2020 |
| Docket Number | Case No. 20-cv-1148 |
| Parties | R.V. et al., v. Mnuchin, et. al |
| Court | U.S. District Court — District of Maryland |
This Memorandum Opinion and Order addresses the Government's letter regarding a proposed motion to dismiss, ECF No. 32, and Plaintiffs' response, ECF No. 33. For the reasons discussed below, the Government's letter is construed as a motion to dismiss and is denied without prejudice. This case will proceed with the Government filing an answer, and the Court will schedule a conference call to determine whether any discovery is needed before scheduling the briefing of cross motions for summary judgment. Because the briefing on the Government's intended motion to dismiss was both expedited and truncated, the Government may reassert its arguments for dismissal with any additional authority as part of the summary judgment briefing.
To begin, I briefly memorialize the discussion with the parties during our video conference on May 8, 2020. During that conference, we discussed the unprecedented nature of the COVID-19 pandemic, its strain on the resources of the Court and the parties, and its particular relevance to the claims of this case. In light of this, the parties agreed to outline the bases for a proposed motion to dismiss and opposition in letters of five pages or less, single spaced. I informed the parties that I would review their letters to determine whether full briefing was necessary, and if not decide whether to dismiss the case or allow it to move forward. If the case did move forward, the Government's proposed bases to dismiss the case would be preserved and they could raise them again at the summary judgment stage.
Turning to the substance of this case, Plaintiffs are seven children who are U.S. citizens ("Citizen Children Plaintiffs"), and their parents, one or both of which is an undocumented immigrant ("Plaintiff Parents"). Compl., ECF No. 1 at ¶¶ 13-21. Plaintiffs challenge the allegedly intentional and discriminatory denial to U.S. citizen children of the benefits of emergency cash assistance distributed under the Coronavirus Aid, Relief, and Economic Security ("CARES") Act in response to the COVID-19 pandemic solely because one or both of a child's parents are undocumented immigrants. Id. at ¶ 1.
The CARES Act provides "economic impact payments" of up to $1,200 for eligible individuals and $500 for each of the individual's qualifying children under age 17. 26 U.S.C. § 6428(a). The Act directs Defendant Secretary of the Treasury Mnuchin to distribute these payments "as rapidly as possible." 26 U.S.C. § 6428(f). The Act requires a recipient of the economic impact payments to have a social security number ("SSN"), which excludes undocumented immigrants without a work authorization who file taxes with an Individual Taxpayer Identification Number. Compl. at ¶ 37; 26 U.S.C. § 6428(g); 20 C.F.R. §422.104(a). The result is that qualifying U.S. citizen children who have only undocumented parents cannot receive the $500 economic impact payments intended for their benefit. Compl. at ¶ 39. Similarly, U.S. citizen children who have one undocumented parent and one citizen parent or immigrant parent with a social security number cannot receive the $500 economic impact payments intended for their benefit unless the parents file a 2019 tax return as "married filing separately" rather than "married filing jointly," which can increase the family's tax burden. Id.at ¶ 40. Plaintiffs allege that this scheme intentionally discriminates against U.S. citizen children solely because of their parents' alienage. Id. at ¶ 3.
Plaintiffs seek to certify two classes. First, Citizen Children Plaintiffs seek to certify a nationwide class of "all U.S. citizen children under age 17 who have been or will be denied the benefits of economic impact payments for 'qualified children' under the CARES Act solely because the children have a parent who is an undocumented immigrant who has no social security number." Id. at ¶ 57. Second, Parent Plaintiffs seek to certify a nationwide class for damages of "persons whose U.S. citizen children have not received the benefits of economic impact payments for 'qualified children' under the CARES Act solely because at least one of the children's parents is an undocumented immigrant who has no social security number." Id. at ¶ 64.
Plaintiffs allege three counts for relief. First, Citizen Children Plaintiffs, on behalf of themselves and all others similarly situated, bring a claim against Secretary of the Treasury Mnuchin for violation of the Fifth Amendment of the United States Constitution for intentional discrimination based on their parents' alienage. Id. at ¶¶ 71-74. Second, Citizen Children Plaintiffs, on behalf of themselves and all other similarly situated, bring a claim against the United States for money damages under 26 U.S.C. § 6428 and 28 U.S.C. 1346(a)(2). Id. at ¶¶ 75-80. Third, Parent Plaintiffs, on behalf of themselves and all others similarly situated, bring a claim against the United States for money damages under 26 U.S.C. § 6428 and 28 U.S.C. § 1346(a)(2).
Pending is the Government's letter, construed as a motion to dismiss, in which the Government argues the Plaintiffs' lack standing, this Court lacks jurisdiction, and Plaintiffsfailed to state a claim. ECF No. 32. Plaintiffs have filed a response. ECF No. 33. A hearing is not necessary. See Local Rule 105.6 (D. Md. 2018).
Plaintiffs' claims are subject to dismissal if they "fail[] to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). The purpose of Rule 12(b)(6) "is to test the sufficiency of a complaint and not to resolve contests surrounding the facts, the merits or the applicability of defenses." Presley v. City of Charlottesville, 464 F.3d 480, 483 (4th Cir. 2006). A pleading must meet the standard of Rule 8(a), which requires only "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). The complaint must contain factual content, and more than "a formulaic recitation of the elements of a cause of action" or "naked assertion[s] devoid of further factual enhancement." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal citations omitted). Therefore, mere legal conclusions will not suffice. Iqbal, 556 U.S. at 678. Finally, the factual allegations presented in the complaint must be construed "in the light most favorable to [the] plaintiff." Adcock v. Freightliner LLC, 550 F.3d 369, 374 (4th Cir. 2008).
In its letter, the Government outlines three bases to dismiss the case. First, that the Plaintiffs lack Article III and statutory standing. Second, that the Court lacks subject matter jurisdiction because the Government has not waived sovereign immunity. And third, that the Plaintiffs have failed to state a claim. ECF No. 32. Plaintiffs oppose each argument. ECF No. 33. I discuss each in turn.
The Government argues that the Citizen Children Plaintiffs, and the Parent Plaintiffs as their representatives, lack both Article III and statutory standing. For Article III standing, a plaintiff must meet three requirements:
(1) [the party] has suffered an "injury in fact" that is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision.
Bishop v. Bartlett, 575 F.3d 419, 423 (4th Cir. 2009) (quoting Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 180-81 (2000); see also Lujan v. Defs. of Wildlife, 504 U.S. 555, 560-61 (1992) (same).
The Government argues that the plaintiffs cannot establish injury in fact because they are not "among the injured." ECF No. 32 at 2 (quoting Sierra Club v. Morton, 405 U.S. 727, 734-35 (1972)). This is because the CARES Act structures the economic impact payments to inure to parents, and not to children, and therefore children cannot claim to be injured by their parents' failure to receive any payments. The Government cites to cases regarding the Child Tax Credit and state child support payments to support the proposition that children do not have a direct interest needed for standing when seeking to recover payments for their benefit that are made to parents. ECF No. 32 at 2-3 In re Parisi, 2010 WL 1849386, at *2 .
In response, Plaintiffs argue that a person need not be the immediate recipient of a government benefit to have Article III standing to challenge its denial. ECF No. 33 at 3-4 (). In Village of Arlington, the Supreme Court held that an individual who was interested in living in a particular community had standing to challenge a denial of a rezoning application that blocked an affordable housing project from being approved for allegedly discriminatory reasons. 429 U.S. at 264. Although it was not certain that the housing development would materialize, or that the plaintiff would live there, he adequately alleged injury that "his quest for housing nearer his employment has been thwarted by official action that is racially discriminatory." Id. Similarly, in West Virginia Association of Community Health Centers, Inc. v. Heckler, the D.C. Circuit found that two non-profit health organizations had standing to challenge the formula adopted by the Secretary of Health...
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